Rockstar paid $4.5 billion for Nortel patents and has launched a major attack.

Canada-based telecom Nortel went bankrupt in 2009 and sold its biggest asset—a portfolio of more than 6,000 patents covering 4G wireless innovations and a range of technologies—at an auction in 2011.

Google bid for the patents, but it didn't get them. Instead, the patents went to a group of competitors—Microsoft, Apple, RIM, Ericsson, and Sony—operating under the name "Rockstar Bidco." The companies together bid the shocking sum of $4.5 billion.

Patent insiders knew that the Nortel portfolio was the patent equivalent of a nuclear stockpile: dangerous in the wrong hands, and a bit scary even if held by a "responsible" party.

This afternoon, that stockpile was finally used for what pretty much everyone suspected it would be used for—launching an all-out patent attack on Google and Android. The smartphone patent wars have been underway for a few years now, and the eight lawsuits filed in federal court today by Rockstar Consortium mean that the conflict just hit DEFCON 1.

Google probably knew this was coming. When it lost out in the Nortel auction, the company's top lawyer, David Drummond, complained that the Microsoft-Apple patent alliance was part of a "hostile, organized campaign against Android." Google's failure to get patents in the Nortel auction was seen as one of the driving factors in its $12.5 billion purchase of Motorola in 2011.

Rockstar, meanwhile, was pretty unapologetic about embracing the "patent troll" business model. Most trolls, of course, aren't holding thousands of patents from gigantic technology companies. When Rockstar was profiled by Wired last year, about 25 of its 32 employees were former Nortel employees.

The suits filed today are against Google and seven companies that make Android smartphones: Asustek, HTC, Huawei, LG Electronics, Pantech, Samsung, and ZTE. The case was filed in the Eastern District of Texas, long considered a district friendly to patent plaintiffs.

The lawsuits

The complaint against Google involves six patents, all from the same patent "family." They're all titled "associative search engine" and list Richard Skillen and Prescott Livermore as inventors. The patents describe "an advertisement machine which provides advertisements to a user searching for desired information within a data network."

The smartphone patent wars have been underway for a few years now, and the conflict just hit DEFCON 1.

The oldest patent in the case is US Patent No. 6,098,065, with a filing date of 1997, one year before Google was founded. The newest patent in the suit was filed in 2007 and granted in 2011.

The complaint tries to use the fact that Google bid for the patents as an extra point against the search giant. "Google subsequently increased its bid multiple times, ultimately bidding as high as $4.4 billion," wrote Rockstar's lawyers. "That price was insufficient to win the auction, as a group led by the current shareholders of Rockstar purchased the portfolio for $4.5 billion. Despite losing in its attempt to acquire the patents-in-suit at auction, Google has infringed and continues to infringe the patents-in-suit."

The suits against the six manufacturing companies each assert the same patents—either six or seven of them, depending on the target. The patents cover a variety of innovations and have different inventors. One patent filed in 1997 for a "navigation tool for graphical user interface" describes a way of navigating through electronic documents. Another describes an "Internet protocol filter," and a third patent describes an "integrated message center."

The manufacturer lawsuits name the targets' whole array of smartphones and tablets. The lawsuit against Huawei, for instance, claims the infringing products include "the Huawei M865 MUVE, Huawei Ascend II, and Huawei Premia 4G M931, and Huawei’s family of tablets, including but not limited to the Huawei MediaPad and Huawei IDEOS S7 Slim."

Rockstar has employed two different law firms to file the suits; both firms have patent experience and experience litigating in the Eastern District of Texas. The Google search suit is being handled by Susman Godfrey, which has taken on other sue-the-world patent cases, like Paul Allen's lawsuits against Facebook, Google, and others.

The manufacturer suits, meanwhile, are being handled by McKool Smith, a formidable Texas law firm that has probably wrung more massive verdicts out of tech companies than any other firm. It scored $368 million from Apple for VirnetX, $290 million from Microsoft over i4i's XML patent, and most recently notched a $173 million verdict against Qualcomm.

The ultimate “patent privateer”

When Wired visited Rockstar's Ontario headquarters, it found 10 reverse-engineering experts, working daily to take apart products and find patent infringement. With just a few dozen employees, Rockstar is hoping to convince more than 100 technology companies to pay it patent licensing fees for a huge array of products. "Pretty much anyone out there is infringing," said Rockstar's CEO, John Veschi.

The Rockstar Consortium may be the ultimate example of patent "privateering"—when big companies hand off their patents to small shell companies to do the dirty work of suing their competitors. Essentially, it's patent trolling gone corporate.

The "privateering" phenomenon has long irked Google. In February, when Google filed a patent lawsuit against British Telecom, it said one of the reasons for the suit was that BT had not only sued Google directly, but it had also gone around "arming patent trolls."

Part of Rockstar's strategy is avoiding a patent countersuit by not having any operating businesses. Essentially, the company wants to enjoy the same advantage patent trolls have, even though it's owned by direct Google competitors like Apple and Microsoft.

"The principals have plausible deniability," said Thomas Ewing, an IP attorney who spoke to Wired about Rockstar. "They can say with a straight face: ‘They’re an independent company. We don’t control them.’ And there’s some truth to that."

And Rockstar's CEO was quite straightforward about his belief that whatever promises Microsoft and Apple might have made about how they'll use their patents, those promises don't apply to Rockstar. “We are separate,” he says. “That does not apply to us.”

Rockstar may want to keep the patent conflict as a kind of "proxy war" between Google and its competitors. But Google has plenty of patents, and this new attack seems assured to bring a counterattack.

The smartphone market is more valuable than ever, and the $4.5 billion Rockstar purchase shows that Google's competitors will spare no expense to put a damper on Android, and they hope to make money while they do it. Patents have become the arena in which tech companies have chosen to do battle. Six years after the iPhone and five years after the launch of Android, the stakes keep getting raised.

We can only hope that eventually enough pebbles (or outright rocks) pile up and momentum finally becomes sufficient to end all software and business method patents, period. That is the only true root cure, and it would not only dial back the lawyering, it would also have lots of positive knock-on effects such as freeing up USPTO resources to focus on physical patents once again.

Really, the entire concept of "patent troll", and the negative stigma many people now have of companies suing over patents, fundamentally is misguided. Those are just symptoms of the basic issue of the patents themselves being completely unsound, the rest just natural emerges. There's nothing inherently wrong with an actual inventor or small business coming up with something and then not having the capital to bring it to mass manufacturing and thus being a pure IP firm. But real physical patents, which have real capital investment barriers and generate clear revenue don't create this kind of drama because the costs and benefits can be well calculated all around, and it's straight forward to find workarounds. "Business methods" goes without saying, but in software the valuable part is the actual software and services, ideas are cheap. It's "Photoshop" or "Pixlemator" or "Gimp" or "MS Paint" that are valuable, not "A method to use a computer to manipulate a bitmap, now please give me my $1 billion kthx." With barriers to entry so low as to be non-existent and copyright covering protection of actual works software/math/method patents cause endless harm by their very nature.

Probably only Congress can truly take care of this, and given how intensely dysfunctional that institution is it's going to be quite the long haul. If anything positive can be said for these sort of events it's that it continues to raise awareness and costs. None of these companies have clean hands, there are no "good guys" and "bad guys" here, but at the same time at this point it's hard to blame them too much either. Terrible law will have bad effects in general society sooner or later, and it's not as if there's been any big public pressure of campaigns about it. This also isn't a clear moral cliff like assisting genocide or whatever other comparisons people bring up. It needs to be solved in legislature.

Eventually, we're going to look back at the great patent wars of the early 2000's and ask something like, "How could anyone have thought this was a good idea?", in pretty much the same manner that we, today look back at the cold war with it's M.A.D. mentality of mutually assured destruction.

One patent filed in 1997, for a "navigation tool for graphical user interface," describes a way of navigating through electronic documents. Another describes an "Internet protocol filter," and a third patent describes an "integrated message center."

No matter the outcome of the trial, I pretty much have lost respect for any of the companies involved with Rockstar. Instead of trying to fairly compete against Google, they try to win via litigation.

No, it's not an either-or situation. They are trying to both compete against Google in the marketplace and use patent litigation to cripple Android.

I know it's not an either-or situation, but companies shouldn't resort to litigation to catch up with their competitors. Play fair and earn your market position.

seems to me it's more like "well, they're getting away with it, so we might as well do it too, to level the playing field.

basically it's a couple of schoolboys where they were arguing about something petty... "my dad is better than your dad" or somesuch bs. then one of them decides to not only throw insults, but also start throwing rocks. the other boy looks and sees the teachers don't seem to care that the other boy is throwing rocks, so he starts throwing them back.

here's hoping the teacher eventually notices and slaps both boys with suspension or expulsion.

Patent wars for some time now have sickened me. This is no longer a matter of consumers being the deciding factor of who succeeds. It is now the case of who amasses the most patents to sue the other companies. In the end, we as consumers are the ones that will lose. Innovation and furthering the technological world will become stagnate to the drums of potential lawsuits.

I like to believe that we live in a world will the success of an item is based on the contents and quality of it and no who has the best hand. Now if someone ever considers starting up their own company and design, an immense amount of resources will go into making sure X does not infringe on what of a number of patents out there.

At this point, I just want all the companies who participate in these non consumer friendly practices to get their financial butts handed to them so they can realize how wrong all of this is. Worst thing is, I do not think any of the companies care at all. So long as they see their own product doing better, they do not care who they step on.

No matter the outcome of the trial, I pretty much have lost respect for any of the companies involved with Rockstar. Instead of trying to fairly compete against Google, they try to win via litigation.

No, it's not an either-or situation. They are trying to both compete against Google in the marketplace and use patent litigation to cripple Android.

I know it's not an either-or situation, but companies shouldn't resort to litigation to catch up with their competitors. Play fair and earn your market position.

Playing fair includes the concept of not ripping off other people's work.

Now personally, I don't think that Google has really ripped off Apple in a legally actionable sense, but I do think they got a head start on aiming Android in the right direction by having Eric Schmidt on the Apple Board of Directors. I can't blame Google for taking advantage of that (I would have too). But Steve Jobs thought that Google and Apple were friends and if Google's actions weren't quite scummy, they were at least a little backstabby.

No matter the outcome of the trial, I pretty much have lost respect for any of the companies involved with Rockstar. Instead of trying to fairly compete against Google, they try to win via litigation.

It's so damn scummy.

Agreed, but expected from some of the biggest douchebag companies in the world.

Is the only reason this is "douchy" that it involves lawsuits? It seems people here are equating lawsuits with unfair business practices, but it's not clear at all why anyone thinks this. Can someone explain?

Patents are some of the most important legal protections we have to encourage innovation in computer software and hardware. Their owners need to be able to protect their patents, or the whole system is pointless.

It's douchy because they've created a shell company to sue on their behalf as to avoid counter-suits.

Patents are some of the most important legal protections we have to encourage innovation in computer software and hardware. Their owners need to be able to protect their patents, or the whole system is pointless.

No matter the outcome of the trial, I pretty much have lost respect for any of the companies involved with Rockstar. Instead of trying to fairly compete against Google, they try to win via litigation.

It's so damn scummy.

Agreed, but expected from some of the biggest douchebag companies in the world.

Is the only reason this is "douchy" that it involves lawsuits? It seems people here are equating lawsuits with unfair business practices, but it's not clear at all why anyone thinks this. Can someone explain?

Patents are some of the most important legal protections we have to encourage innovation in computer software and hardware. Their owners need to be able to protect their patents, or the whole system is pointless.

That's the thing, patents are granted to encourage innovation. I don't see the shell company performing an iota of innovation here.

No matter the outcome of the trial, I pretty much have lost respect for any of the companies involved with Rockstar. Instead of trying to fairly compete against Google, they try to win via litigation.

No, it's not an either-or situation. They are trying to both compete against Google in the marketplace and use patent litigation to cripple Android.

I know it's not an either-or situation, but companies shouldn't resort to litigation to catch up with their competitors. Play fair and earn your market position.

Playing fair includes the concept of not ripping off other people's work.

Now personally, I don't think that Google has really ripped off Apple in a legally actionable sense, but I do think they got a head start on aiming Android in the right direction by having Eric Schmidt on the Apple Board of Directors. I can't blame Google for taking advantage of that (I would have too). But Steve Jobs thought that Google and Apple were friends and if Google's actions weren't quite scummy, they were at least a little backstabby.

Google certainly didn't rip off Apple by infringing Nortel's patents. To the extent Google may have been ripping off Nortel, Apple and Microsoft were too. There's nothing moral about this, this is just about money. Apple and Microsoft spent $4.5 billion dollars in the hopes of costing Google more than $4.5 billion dollars. That's all. No more, no less.

Patent wars for some time now have sickened me. This is no longer a matter of consumers being the deciding factor of who succeeds.

There are valid reasons for patent litigation rather than merely allowing a free-for-all fight for consumer sales.

What if company A invests a lot of money into research and invents something truly new -- say for example, a teleportation device -- and begins manufacturing, only to have companies B & C reverse engineer it, and start manufacturing clones that they sell for $50 less.

Now company A is unlikely to be able to recoup the costs of research and go bankrupt, while companies B & C, never having had to invest in the research, remain profitable and split the market between themselves. Clearly this is not fair.

Unfortunately patent cases are usually not so cut and dry, because hardly anything truly new is invented, and most patented inventions are incremental improvements on previously existing technologies, which makes it very easy to argue about whether the invention is truly worthy of patent protection.

I really don't care what the outcome of this is. It's Goliath fighting Goliath, and in reality this is just how business is done at that level. All these guys are each other's customers, suppliers, and competitors. They will absorb and deal with this, and the world will keep on ticking, just fine.

None of them think that they will kill google or android with this, nor vice versa, it's really just about doing business in the current industry climate. Extreme fits of violient activity usually have a way of reaching equalibrium and stability after a period of time. Eventually all this nonsense will lead to some sort of reform or detente, and everyone can move on. To establish boundaries and set norms, you must push to the extreme sometimes and see where everything lands.

No matter the outcome of the trial, I pretty much have lost respect for any of the companies involved with Rockstar. Instead of trying to fairly compete against Google, they try to win via litigation.

No, it's not an either-or situation. They are trying to both compete against Google in the marketplace and use patent litigation to cripple Android.

I know it's not an either-or situation, but companies shouldn't resort to litigation to catch up with their competitors. Play fair and earn your market position.

Playing fair includes the concept of not ripping off other people's work.

Now personally, I don't think that Google has really ripped off Apple in a legally actionable sense, but I do think they got a head start on aiming Android in the right direction by having Eric Schmidt on the Apple Board of Directors. I can't blame Google for taking advantage of that (I would have too). But Steve Jobs thought that Google and Apple were friends and if Google's actions weren't quite scummy, they were at least a little backstabby.

Google certainly didn't rip off Apple by infringing Nortel's patents.

True. Nortel's patents are merely a means to an end.Many problems would be solved if patents could not be bought or sold away from the original assignee.

How is this not illegal collusion? Multiple companies, all operating within the same sphere, pooling their money to fund a shell company that purchases these patents and then sues their mutual largest competitor. It certainly seems like it should be illegal.

Patents are some of the most important legal protections we have to encourage innovation in computer software and hardware. Their owners need to be able to protect their patents, or the whole system is pointless.

Patents are important for physical things. Its less confusing, and allows other people to innovate to receive the same result in a different way. Software patents are shit because the judge can't apply the correct standards because of the subject-matter, the jury are a bunch of average people that can't understand the subject-matter. Its just a bad spot to try and apply any kind of legal framework.

Eventually, we're going to look back at the great patent wars of the early 2000's and ask something like, "How could anyone have thought this was a good idea?", in pretty much the same manner that we, today look back at the cold war with it's M.A.D. mentality of mutually assured destruction.

No matter the outcome of the trial, I pretty much have lost respect for any of the companies involved with Rockstar. Instead of trying to fairly compete against Google, they try to win via litigation.

No, it's not an either-or situation. They are trying to both compete against Google in the marketplace and use patent litigation to cripple Android.

I know it's not an either-or situation, but companies shouldn't resort to litigation to catch up with their competitors. Play fair and earn your market position.

Playing fair includes the concept of not ripping off other people's work.

Now personally, I don't think that Google has really ripped off Apple in a legally actionable sense, but I do think they got a head start on aiming Android in the right direction by having Eric Schmidt on the Apple Board of Directors. I can't blame Google for taking advantage of that (I would have too). But Steve Jobs thought that Google and Apple were friends and if Google's actions weren't quite scummy, they were at least a little backstabby.

Wake me when they're suing over a patent that is in any way innovative. One of the six involved here is for "what if we showed ads related to what you're searching for?" which is an industry standard thing that is in no way an invention, and a decent patent inspector would have been able to find a mountain of prior art for.

No matter the outcome of the trial, I pretty much have lost respect for any of the companies involved with Rockstar. Instead of trying to fairly compete against Google, they try to win via litigation.

No, it's not an either-or situation. They are trying to both compete against Google in the marketplace and use patent litigation to cripple Android.

I know it's not an either-or situation, but companies shouldn't resort to litigation to catch up with their competitors. Play fair and earn your market position.

Playing fair includes the concept of not ripping off other people's work.

Now personally, I don't think that Google has really ripped off Apple in a legally actionable sense, but I do think they got a head start on aiming Android in the right direction by having Eric Schmidt on the Apple Board of Directors. I can't blame Google for taking advantage of that (I would have too). But Steve Jobs thought that Google and Apple were friends and if Google's actions weren't quite scummy, they were at least a little backstabby.

Wake me when they're suing over a patent that is in any way innovative. One of the six involved here is for "what if we showed ads related to what you're searching for?" which is an industry standard thing that is in no way an invention, and a decent patent inspector would have been able to find a mountain of prior art for.

Yeah, its called a phone book. I search for something like a lawyer... and BAM I see 10 pages of law ads... Apply the same concept to electronic medium and now you have something novel?

Our Congress is responsible for this. Among their many other sins, software patents should never have been legal. If Congress would listen to their constituents for a change instead of the lobbyists, we would not be in this pickle. Add it to the list of reasons to turn them all out of office.